Question

A person invested $1,500 in an account growing at a rate allowing the money to double every 12 years. how much money would be in the account after 15 years, to the nearest dollar?

A) $2,125
B) $2,750
C) $3,150
D) $3,568
E) $4,000

Answer 1

After 15 years, there would be approximately $3,150 in the account.

Step-by-step explanation:

To find the amount of money in the account after 15 years, we can use the formula for compound interest.

Since the money doubles every 12 years, the growth rate is 100% every 12 years. Therefore, the growth rate per year is approximately 6.116%.

Using the formula A = P(1+r/n)^(nt), where A is the final amount, P is the initial amount, r is the growth rate per year, n is the number of times the interest is compounded per year, and t is the number of years, we can calculate the final amount:

A = 1500(1+0.06116/1)^(1*15) ≈ $3,150